How Do You Spell ‘Retaliation’?

What do you think? Companies like S&P and Moody’s look at a variety of factors to try to determine the creditworthiness of a company or a country. Their assessments are festooned with warnings and cautions, just like those “past performance is no guarantee of future returns” slogans you see pasted at the bottom of every mutual fund you’ve ever plunked a dime into. Investors certainly did “lose billions” in the financial crisis. But whose fault was that?

The hyenas, in the shape of various states’ attorneys general and other entities unhappy about the fact that they lost money investing in some of the most exotic and risky financial instruments ever devised by the mind of man, are gathering around the tasty carcass of these companies. But no one forced anyone into making these investments. Credit ratings are not predictions, they’re educated guesses about the future based on the past. Often — usually, in fact — the future looks a lot like the past. Sometimes it doesn’t.

Partly, I think, the move against S&P (the other rating agencies are also in the government’s crosshairs) is a an example of the time-honored practice of scapegoating. People are looking for someone to blame and the rating agencies seem like low-hanging fruit: “Hey, they told me this might be a great (though risky) investment, and I lost money! Whom can I blame?”

But I suspect this is not only about scapegoating. I suspect it is also about retaliation. We are living with the most fiscally incontinent administration in U.S. history, perhaps in world history. Both S&P and Moody’s took note of this incontinence and broadcast the news by downgrading U.S. debt in 2011. The result? A $1 billion lawsuit against S&P. Merely post hoc? Or do you discern a teensy bit of propter hoc there as well? I do.

Meanwhile, if you are really interested in who and what caused the financial meltdown of 2008, I have some reflections here.

You and other conservatives are going to fall into another Obama trap again.

They are counting on you to come to the defense of the rating agencies like Moody’s and S&P. So that then they can come forward with their evidence that these agencies screwed up badly. And then they’ll say “See? The GOP is siding with white-collar criminals.”

Don’t rush to defend these agencies. There have been numerous news reports of how badly they screwed up. Obama would like nothing better than to have us side with a bunch of idiot investors and even white-collar criminals.

Obama’s advisers have a shrewd understanding of the GOP base’s psyche, I’ll say that for them.

They know that the GOP base hates him so much that anything he goes after, they’ll reflexively rush to defend. In this case, AFTER he gets the GOP base on record denouncing this investigation, THEN they’ll come forward with all their evidence–and make the GOP base look like it’s siding with corporate criminals.

The horrendous flaw in your argument is that you’re assuming the Dems aren’t going to accuse the Republicans with siding with White Collar criminals anyway. That narrative is already in place and no amount of capitulation from the GOP is going to change that.

True enough. I believe no one here as much as squeaked about Egan-Jones, so why push the S&P affair? Ratings are a mug’s game, anyway, and if agencies make money out of gazing in their crystal ball, let them deal with the consequences as well.

The Google Translate version isn’t as easy to understand as some of us might like. It’s a bit like reading those amusing instructions in English that are often enclosed with products made in Asian countries.

“Tantum quisque habet in Sicilia quantum hominis avarissimi et libidinosissimi aut imprudentiam superfugit aut satietati superfuit.”
So much of a man as much as each one has a most avaricious and licentious in Sicily satiety or want of foresight or superfugit some left over.

Standard & Poors poisoned the wells Christians draw water from and financed the YouTube video which led to the attack at Benghazi. They are Illuminati Masters of Mind-Control and secretly ordered Chrysler to use lug nuts which spun “leftie-tightie/rightie-loosie” in the early 1960s.

S&P et al are suffering from their own success. For years, nay generations, their assessments were conservatively reliable. This reliability was based upon years of Standard Products managed, sold and traded in Standard Ways. The financial instruments of yore were STANDARD.
Now enter the Academy. Lets generate lots and lots of MBAs (full disclosure, I are one.) who have been taught how to manipulate the mathematics and create NON Standard Products that are nearly impossible to evaluate in the Standard Way.
Hire lots of them at S&P.
Make the Old School (read Ivy) connection more important than good product…
You get the gist.
So we re and over regulate thereby add complexity to the system setting up the next failure sooner than later.
ta

This may sound like sour grapes but I cannot but help despair government that charges upward of $500 to get a car out of impound(tow away zone violation)San Francisco. It was my wife’s first day back to work after 5 months of cancer treatment and therapy. We admit she is not exactly on her game yet. We also admit that there probably are quite a few impounds that go unredeemed because of the cost. Of course this system is not FAIR. It has to pay for its own excess. And who pays but the poor sap that tries to do things the right way. By the way we have been making cobra payments so yea, we’ve got all sorts of diposable income.
By the way has anybody noticed the lights went out in the super bowl; it’s all Bush’s fault.

So, Moody’s consistently over-rated, but it’s owned by Friend-of-Barack Warren Buffett (who is disappointed he can’t pay more taxes) and won’t be prosecuted. S&P has no such friend, so it will be eviscerated. Nice. Good to be reminded where we stand.

Friends = rewarded handsomely
Enemies = punished mercilessly

At least Conan would say it honestly and not pretend he was just doing the right thing.

Conan, what is best in life?
Conan: To crush your enemies, see them driven before you, and to hear the lamentations of their women!

It’s just a tax on the successful. If these companies had contributed more money to the Demos during the latest campaigns, all would be ignored. Moody’s, anyone?
Guilt or innocence have nothing to do with this case. S&P is just negotiating how much it will cost for this govt action to go away. If that’s not a tax, then John Roberts doesn’t wear a robe.

In a similar vein, gas prices have been up huge all over the country. Wait until about mid-July, right after Exxon et al report major second quarter profits. You just know there will be a call for a windfall profits tax on oil companies. Who will be exempt? Why BP, since they’ve already had to throw $20 billion into the leviathan.

I’m glad I didn’t learn lattin and that I was able to read Cicero’s works in English. I was instantly a fan and collected most of published works. He had a profound effect on my thinking for just the reasons you outlined. I think you are right that making Cicero just a tool for learning Latin does a disservace to a great mind.

This justice department is an instrument of punishment and revenge–certainly not justice. What a joke! You could see this coming a mile away. If they want to go after an institution that caused the 2008 collapse of the mortgage backed securities and housing market, then I would suggest the executive and legislative branches of the US government. It was their threats of sanctions against lender which compelled more and more lending to people who could not afford the homes hey bought but all in the name of discrimination. Also the government approved the sale and securitization of these sub-prime loans to fannie mae and freddie mac.Duh! Then we all know what happened as these two incompetent players later securitized and sold these loans into the portfolios of global investors. These institutions caused the collapse not S&P and if there were ratings issues or misjudgements well guess what Moodys and Fitch were also doing about the same thing as S&P. This justice department is the same corrupt group that fought against voter id laws, sponsored the stupid fast and furious program, and other corrupt prosecutions across the country. We get this.

A brief explanation: The banks bundled sub-prime loans (at best A- and at worst C rated) loans. They then asked the rating agencies, including S&P but also Moody’s and Fitch, to evaluate these bundles. Because the ratings agencies were being paid by the banks they rated the bundles as A+ (A+ is “good as gold” – the US government was A+ until the absurd budget cliff antics got it downgraded – and then sold them as such, to other banks, pension funds, foreign banks. Did your pension suffer as a result? If so, blame the banks AND the ratings agencies. But it you are OK with the banks and ratings agencies colluding to rip off all of us then you should support the prosecution of these thieves. Is the Tea Party about letting the crooks rob us and everyone else?

” But it you are OK with the banks and ratings agencies colluding to rip off all of us then you should support the prosecution of these thieves.”

wait what? that basically contradicts the entire rest of your post. You seemed to be implying we should support these prosecutions, then say that we only should if we’re OK with being ripped off?

FWIW our credit rating was due for a downgrading regardless of any budget antics. How high can our debt actually get before it causes serious problems? 20T? 50T? 100T? It’ll be over 20T by the time Obama leaves office, we spend 50% more than we take in and that shows no signs of slowing. Our bonds can never be “good as gold” because the US government can inflate its way out of debt, but cannot create gold. When they inevitably decide mass inflation is the only way to handle the debt the bonds will become all but worthless while the gold will rise in value to keep pace.

Indeed a typo, thanks for pointing it out. It should read “But it you are OK with the banks and ratings agencies colluding to rip off all of us then you should OPPOSE the prosecution of these thieves.”

It is just a very peculiar position to support the very ratings agencies who were totally complicit in creating the financial crisis.

I think the S&P downgrade of the USA’s credit rating was a preemptive strike.
They knew perfectly well, as Brutus so succinctly sets forth above, that they had not been independent and neutral analysts regarding the subprime loan bundles, but shills, singing for their supper. And they also knew that they would be called on it, sooner or later.

But if they moved first, and said out loud what everybody knew- namely that the American welfare state has no damned intention of changing its ways or even starting to pay what it owes- then any subsequent action against them would be chalked down to political retaliation.

I predict an end result as follows: a slap on the wrist for S&P, who will reciprocate by suddenly- mirable dictu!- restoring America’s A+ rating, just in time for you-know-who to take the credit. The kabuki dance goes on.

S&P was way down on the mortgage and derivatives fraud food chain. The two Jaime’s, Dimon (Goldman Sachs the Treasury) and Gorelick (of no sharing of Intel between the FBI and CIA fame and later forcing financial institutions to qualify any person of limited means to buy more house then they can afford). And a whole host of bad people in for the greed at the major banks and AIG. And let’s not forget MF Jon Corzine that made $1.6 billion magically disappear, must have gone Global. The DOJ is metaphorically out to shoot the messenger and with no FBI or any remaining investigative law enforcement with integrity it is sadly a kangaroo court where the real or more guilty walk among the rich.

Cicero’s words should come as no surprise. People are still as they were in his day just as they were the same 2,000 years before him. We still have the same problem which is that the least worthy and most dangerous keep getting into power with the same disastrous results.

Humanity will be stuck in this cycle of tyranny, destruction and misery until it wakes up one day and decides to keep the psychopaths and other lunatics far away from the levers of power in politics, business and religion. It might take the next 500 year collapse to set the stage for that. Then again, probably not.

As much as I admire Cicero’s oratory and other feats of statesmanship, I would have everyone recall that, here, he was arguing on behalf of the nobiles, who had arrogated almost total control of the ager publicus to themselves at the time of the Catilinarian conspiracy. What free small landholders were left were debt-ridden and on the brink of slavery (the slave population of the republic had risen to something like 35%) thanks mostly to their farms’ long fallow periods, which were a result of the their commitments as citizen-soldiers in Rome’s many foreign wars.

The crisis, going back to the time of the Gracchi, split the ruling classes for a century, and the side that won out–the populares–was eventually successful because its policies of conquest and colonization worked to dilute the social unrest caused by so many poor citizens. “Give ‘em a jugerum from Jugurtha!” said Marius. The Optimates were too grasping to do so much as even consider foreign colonies, and they paid for it with the loss of the People.

This is classic Obama. He and his regime screw up our economy to a fair-the-well and then get angry with the S&P because they had the nerve to graphically point it out. Alinsky tactics in action. Demonize the messenger.